Of course, as ever, there were other things going on outside of the Financial Conduct Authority, which we will now cover off in the traditional round-up.
1. Fee hike angers advisers.
On Tuesday (23 June), the City watchdog confirmed its planned 10.2 per cent fee hike for advisers for 2015 to 2016 and defended the methods it uses to calculate their contribution to its annual costs as “fair and proportionate”.
Firms in the A13 block - those who do not hold client money - will pay £74.9m over this next 12 months, up from £68m during the last period.
Unsurprisingly this raised the heckles of many in the industry, with Garry Heath, director general of new adviser body Libertatem, telling FTAdviser that the only way to tackle this is to make the FCA more accountable.
Not to be outdone by this new body, the Association of Professional Financial Advisers set out its lobbying priorities for the next parliamentary year in an open letter to advisers, which highlighted a “fundamental mismatch” between a government and regulatory bodies deemed unable to control their budgets.
2. Communication is key.
A few days later, the regulator tried to bury bad news with the publication of both a discussion paper and a report on the effectiveness of both it and the industry’s consumer communications.
The FCA’s discussion paper challenged firms to consider innovative ways of engaging on products and services, proposing videos, infographics or other new approaches to present information clearly and understandably.
The accompanying report produced by Oxera also urged providers to display things in pounds and pence, rather than percentages, along with other suggestions for improving pension wake-up packs and adviser disclosure documents.
Food for thought and another opportunity for you to tell the FCA what you think (the deadline for your thoughts is 25 September).
3. Investigation sees the light of day.
Many hours of tireless work by our news editor culminated in revelations this week that a regulated friendly society is being investigated by the West Yorkshire and Humber regional fraud team in connection with money laundering allegations regarding pension investments.
The Cornerstone Friendly Society, to which transfers were blocked by Liberty Sipp and another self-invested pension firm last year amid concerns over alleged pension liberation activity, is already in the process of being liquidated.
FTAdviser was first contacted about the business around a year ago, when several Sipp providers blocked transfers, and it appears that some investors may have been introduced to Cornerstone via an unauthorised adviser who described himself as a ‘wealth protection specialist’.
The case continues...
4. Platforms stubborn on asset options.
We’ve covered it before and chances are we’ll cover it again, but the issue of adviser access to investments like exchange traded funds and investment trusts on three of the biggest platforms, raised its ugly head once again.
First of all, the typically outspoken Novia boss Bill Vasilieff said some of the larger fund supermarkets were trying to “muddy the waters” around ETFs by branding them “risky” and stating that there was a lack of demand from advisers and clients.
Cofunds, Old Mutual Wealth and Fundsnetwork responded that they did not see sufficient demand but such assets were being looked at.
Then Henderson research had FTAdviser pestering their press offices again, after the firm claimed 57 per cent of financial advisers were not recommending investment trusts to their clients, due to a lack of platform access.
The platform trio trundled out similar lines once again, although Old Mutual were refreshingly candid in stating that advisers rarely use one platform these days and they should seek investment company access on one of their smaller rivals instead.
5. Greek tragedy continues.
Finally, to the Mediterranean, where among the pretty beaches and delicious food, the issue of European Union mandated austerity continued to ruin the vibe.
Our colleagues over at Investment Adviser covered the debt deal wrangling extensively, with Monday (22 June) seeing star European equity manager Richard Pease suggesting some “advantages” to a Greek exit for the eurozone, in spite of current market nerves.
On Tuesday (23 June), the Greek crisis was reported to be causing uncertainty about when the US central bank is going to finally hike its interest rate, while Schroders European equities manager James Sym made the surprise omission that he was considering buying a Greek bank and telecom company if the country’s knife-edge bailout negotiations prove successful.
Other equity managers revealed their strategies, while JPMorgan’s global strategist and IA columnist told investors to “get used to it”.
The FTSE 100 opened lower this morning, down 0.75 per cent to 6,756.71, as talks came to a standstill. This Greek tragedy is dangerously close to turning into a farce.
peter.walker@ft.com
